Compute both basic and diluted earnings per share

Assignment Help Financial Management

Reference no: EM131458527

The Pharoah Corporation issued 10-year, $4,790,000 par, 7% callable convertible subordinated debentures on January 2, 2017. The bonds have a par value of $1,000, with interest payable annually. The current conversion ratio is 14:1, and in 2 years it will increase to 20:1. At the date of issue, the bonds were sold at 97. Bond discount is amortized on a straight-line basis. Pharoah’s effective tax was 40%. Net income in 2017 was $8,000,000, and the company had 2,015,000 shares outstanding during the entire year.

(a) Compute both basic and diluted earnings per share. (Round answers to 2 decimal places, e.g. $2.55.)

Basic earnings per share $

Diluted earnings per share $

Reference no: EM131458527

Questions Cloud

Corporate-level strategy formulation responsibilities : 1. Discuss the major corporate-level strategy formulation responsibilities. How are they different from business-level strategy formulation responsibilities?

Cohesive argument for the change in your community : Well-developed paragraphs that include evidence from sources to support your argument for a specific change in your community or workplace.

Differentiate between high and low involvement decisions : Differentiate between high-involvement decisions and low-involvement decisions. High-involvement decisions have high levels of potential social or economic.

How global societal issue impacts a specific population : Identify the global societal issue you have chosen to research for your Final Argumentative Essay and explain why further research on this topic is important.

Compute both basic and diluted earnings per share : Compute both basic and diluted earnings per share.

Categorize high- or low involvement product : Categorize each of the following as a high- or low involvement product: toothpaste, notebook computer, apartment, cup of coffee, cell phone service.

What elements are necessary for a valid contract to exist : What elements are necessary for a valid contract to exist? Define what constitutes a "valid offer." Evaluate each proposal.

Find the sustainable and internal growth rates for firm : Find the sustainable and internal growth rates for a firm with the following ratios: asset turnover = 1.20;

Identify a concern that represents a current issue : Identify a concern that represents a current issue in any healthcare organization of interest to you. Describe the issue in a problem statement format.

User Account

All Pages